Thank you. This is the June 17th workshop. Apologize we are running a few minutes late. We've been working on some audio issues. So, just wanted to uh apologize for that. We'll start off with roll call, please. Council member Nordv is absent. Council member Woods here. Council member McKenzie here. Council member Schwear here. Mayor Mongi here. Um Norby's here. Council member Nordby has present. Thank you. All right. Here. Thank you. Thanks. Can I get a motion to adopt the agenda, please? So move. So move. Council member Schwar. Second. Second. Council member Woods. All those in favor say I. I. I. Thank you very much. Topics. Thank you, Mayor. We got one topic this evening. It is having EAPC, the uh engineer and architectural firm that is been hired to do our feasibility study on the community center. Uh we will kick this off with a Gree, our city communications. Hello council. Hello. Good evening. Okay. So, um I'm here because we are going to be um updating you on what we've been working on for the community center project. And I'm just going to do a quick background um to kind of refresh our memories on what's been done for this project um previously and then where we're at to this point. So, the community center operated from 1992 to 2012 when it transitioned to a leasing facility until its closure in 2022. Um so, the closure was due to declining membership and usage. uh financial challenges in operating a full community center as a city, increased competition from neighboring facilities like the Maplewood Community Center, and then the pandemic impacts as well as significant deferred maintenance. So, to this date, the Ramsey County Library is the only part of the facility still open to the public. So, our present actions are that um a previous city council um voted to retain the building and not sell it um and then to explore renovation options. And so we brought in Wal Architects who completed an initial building analysis and a cost estimate for bringing the facility back to basic operational standards. Um since then, the city has secured funding in both state and federal. Um and then this grant uh funding requires the center to serve as a multicultural senior youth and veteran populations for a minimum of 20 years or the funds must be repaid. So the current phase that we're in is that the city has hired EAPC architects and engineers as a consultancy group to explore creative and feasible feasible re uh renovation ideas. align project plans with available grant funding and to deliver a comprehensive feasibility study to you city council. So the next steps are that we're going to share EAPC's initial findings with the city council. We're going to gather some public feedback and and present that at a later date and then eventually we're going to be seeking your direction to determine the future of this project. Um I'm now going to introduce the team. Thank you, Eva. All right, so it's the first time we've been in front of you folks, so we want to take a second to talk to you about our team. So, EAPC, Architects, Engineers. I'm Mike Clark. I am the director of our civic design group. And I have with me Andrew Subie. He's one of the architects in our office who's been doing a lot of the work uh in the background. Um we also have as part of our team Ballard King and Associates. They are experts at recreational facility planning and operations. So, they're here to advise us on how best to set this up. Uh, which by the way includes those multicultural centers. So, they're here to help us talk about how to set this up so it would function for you folks. And then we also have Jill Brown Consulting as a member of the team. She's not here tonight because we haven't gotten to her part of the work yet. So she will be doing the uh a um public awareness part of the campaign that is next to come. Okay, that is our team. Uh here's our agenda for the evening. And I'm not really going to go through this agenda with you. What I want to tell you about this agenda is we have a lot of information we're going to share with you tonight. So, we've broken it up into these four steps you see on the screen. And we are going to stop after we do each one of these and ask for questions so that we're not overloading you with too much information and giving you time to uh to to uh understand what it is we're talking about. So starting with the project parameters, we want to make sure everybody understands the directions that we were given and the background behind the project. So first is the grant funding. So you've been awarded two separate grants, one from the state, one from the federal government. Uh I'm not going to read through all of this grant uh funding language from the state, but we did highlight a few words that uh tell you what kinds of things this grant includes. So it can include funds for design and construction. It can include funds for renovating and furnishing and equipping your facility. So that's a lot of stuff and it it covers a lot of ground. That's a good thing. Sometimes these things leave out, you know, design. You can't do design, you can't do furnishings, all you can do is build. This thing includes the full boat. Um, some other words in here that uh we kept running across as we were working on the project is um an expansion and renovation of the library. The library is prominently featured in here and the library really wants to stay. Um, it talks about a gym and a track that's getting into the recreational components. Our discussions with the state about that is recreation needs to remain a piece of this project. Um and then the multicultural community gathering facility that covers a lot of ground. Um but we think that we can get it all to work. But those things that you see highlighted are the things that kept coming up the more we worked on the project. Um so the image that we have up here the graphics is more or less uh kind of breaking down and taking a little bit of a site analysis of your existing facility uh inside. So you can see uh it's a very tight lot. There's really no expansion for additions. Um we have limited parking about 45 spa spaces. We have additional street parking and then we're also kind of doing some graphics of kind of uh walking paths around the facility and then out to your nearest public um public transportation stop which is about 300 feet 5-ish minutes. Um not terrible there. Um, and then we're also showing some yellow graphics of a potential bus bus and and or parent um kind of drop off lane or kind of um access points showing maybe in the future if if this facility is used for after school, how how is that going to function? So, that's really more or less what we're shooting for with this graphic. Um, again, the the busing um functionality of that if we do proceed with that or if it does proceed with that, you might want to have a greater discussion. um and and um essentially ensure that it's an okay solution for your uh for your busing company, for your school district or or the the authorities having jurisdiction over over that kind of um rotation there. We also have the graphic here and this is essentially um as the facility sits. This is uh the green on the kind of top right would be the library portion. The top orange at the very top of the page would be that small conference room. The large pink uh region would be your um fireside conference area and then also the little kitchen. And then um your your larger blue space along the bottom and the top right would be your your gymnasium space and then the track the smaller kind of breakout rooms up there. Um if we were to to remain the facility as it is as uh as all walls are are they are right now we would foresee that there would be potential um FA five kind of revenue generators if you will. Um and you can see that with the different colors there. the lighter blue or teal, that's more or less for your um building building equipment and and kind of public access to ensure that we're not making any issues with code violations of preventing somebody from their egress path. Um I was able to walk through the facility a handful of times. Um my it was myself for the architectural and then we had our mechanical group come through also. Uh we did a review of of where it sits. Um, and essentially the the facility is um a very enjoyable spot. I've been in there on a on a sunny day. I've been in there kind of in an overcast rainy day. Very seldom did we flip lights on. Um, you have a lot of great natural light um just pouring into that space. Very comfortable. Um, so so essentially with this you have a lot of great bones. You have a lot of great facility that could be used. um and and we want to ensure so we also um would like to potentially do interview with staffs and then we also use our analysis and the wool documentation that we had and just kind of verified numbers and um kind of proceeded. So essentially you have a lot of great space but there's been a few miscellaneous um deferred maintenance items that kind of have gone um and there's been maybe water water issues and trying to mitigate the water issues and uh there there's definitely some items that need to be addressed u moving forward to to fully utilize the space. Um I don't think anybody in this room or on the board would be surprised by that comment. Um but it it is it's a nice facility. It just needs a little bit of a little bit of rub, a little bit of love. So, so we took that analysis, we took that look at the building. We also, as we said earlier, we incorporated the wool uh information into our analysis of that. We went through that report and looked at the parts and pieces of that that would need to be done to make the facility useful. Whether it's useful to you or useful to uh potential tenants, there is work that needs to get done. Roofing, windows, uh HBAC, some electrical work, that kind of thing. Um, so, uh, what you're seeing on the screen here, we I don't know that we need to, uh, walk through all of these numbers, but this is taking that W report and it's looking at it as, as like I said, how do we make this useful to you? And you can see that it comes up with a total construction for hard construction only, right? This is just the construction dollars of of $6.5 million worth of work that needs to be done. We said earlier that you had grants of 5.3 million. So you had 6.5 million in hard construction. You got 5.3 in grants. So if we take those construction costs of 6.5, we put on some soft costs at about 25%. That pays for the engineering fees, that pays for some contingencies. It pays for other kinds of costs that come up, legal and those kinds of things that come up in projects, right? We don't have a specific project, so it's hard to nail that down. That's why we're using that percentage. So, um, then you have your grant funding. So, we subtract out the 5.3 million and you end up with a total capital improvement project that would cost about 2.8 8 million for the city to fix it after you've used up all the grant money. So, there's additional funding you'd have to put in beyond the grant funds. We also included a $250,000 allowance in here to replace the gym floor. We did not pause long on those pictures we showed you, but if you've been in there, the gym floor has been uh abused over the years and for it to be used as a gymnasium. That gym floor would have to be replaced. There are potentials that somebody leasing it might fix that as part of a tenant improvement, but it also might require you folks to do that in order to find that tenant. So, we wanted a project here that gave you a real picture of what it would take to bring that building back to a useful uh useful function. So, we included replacing that gym floor or at least an allowance in there for replacing it. So, we end up with a total project of $3.075 million would be the projected cost. And I want to be clear that that represents a reasonable expectation of costs for a range of project options. We're not costing out a specific project. We're costing out a general, you know, for instance, replacing the roof is is a real number that's easy to pick out. But like the gym floor, we don't know what kind of gym floor wants to go in there. That $250,000 would pay for a wood a low-end wood floor. Um, it might be that it only needs to have a rubber floor in it for a multi-purpose use space or something. And so you could get a range, but we wanted something in here that seemed to encompass the project. So that's where we end up with is that the city would need to invest $3 million beyond the grant funding to bring that proh building up to a reasonably useful place. All right. One more part of this init initial piece of work was that we got together with the city. We got together with um at least one member of the council at uh earlier in the process and we talked about what are the guiding principles that we should be looking at when we established uh the various ways of moving forward with the project. So what you see here on the screen right now are the must haves. These come from the grant uh program essentially, right? It must be communityowned. It must have recreation elements. It must be multicultural and it must have the library system in it. That last one comes from both the grant and from our discussions internally that the library is an important part of your community. So everything we've looked at assumes the library stays in the building. We also created a list of shouldaves. These are things that the city staff who talked to us and the one council person felt were important to how we looked at the project moving forward. So it needed to be a long-term solution. The grant requires you to pay back. If if if the facility stops being used like you told everybody it was going to be used for 20 years. If it stops someplace in there being that then you have to pay the money back assuming gets it. Um public private partnership. The city has tried running the facility in the past and that failed. So from the city's perspective, the city staff perspective, having somebody else running the facility is greatly preferred over the city running the facility. And then sustainable programming. Um there have been lots of comments uh that were received in in previous versions of this uh studies previous studies of this project that would like to see short-term use short-term rentals uh a meeting space for a reception or a birthday party or occasional use of the gymnasium for a one one or oneoff events. that's difficult to maintain from the city's perspective. So the should have is that we're looking for a long-term solution, not short-term uses and rentals of the facility. Okay, this is where I pause for the first set of questions. Thank you. Um give us one second here to gather our thoughts. So when is that like you know painting all the rooms everything I mean just to get it like it's opened up like a bow cutting as far as with everything all in or is there still going to be other stuff that's not going to be covered in uh the total of three more million. Thank you for that. Later on we were going to talk about what happens. Those numbers assumed a tenant lease arrangement where somebody came in and said, "We want to take three, four, 5,000 square feet of that space and use it for something." And then our numbers assumed that they did tenant improvements to fix that space up for their use. So, if a charter school wanted to come in and put in some classrooms and stuff, then they would build out whatever they needed and would do their tenant improvements. We do have an option in here later that we'll talk about where we did look at what happens if the city owns it and we put more money in for you to do those tenant improvements. So, it goes to 3.2 million to take away a think later $200,000 of tenant improvement stuff that is not in here. things like replacing ceilings, painting walls, um taking down some of the uh things that other users have put up that don't need to be there anymore. Mhm. $200,000. Okay. Mike, I was wondering if you could touch on um so some of the requirements when it comes to state or federal funding. you know, there's been comments made that well, we could probably do it for cheaper than that, but there there are requirements that go along with uh these kind of fundings that wonder if you could share on that a little bit. Yes, thank you, Brian. Um the state the federal government, let's start with the federal government. federal government comes with uh Davis Bacon uh requirements and that is a lot to do with the prevailing wage rates and everything that you have to pay people to do the work on the project which can uh often exceed the local numbers. Um what we typically find here in the cities is when we're doing that work that those uh rates have have already been accounted for because of the cost of living and working in in the cities here. The state however comes with some sustainability requirements. So if you accept the grant then you must do what is known as B3. B3 is the state's sustainability uh program. Um, an example of what this does is, uh, for instance, you last year or within the last year or so replaced the boilers in the building and you replaced them with a moderate level of new boilers. If the state if you if you'd already accepted those funds from the state and were doing it under the state program, then you would likely be putting in 95% efficient uh, condensing boilers at a higher rate. And we can en envision that and we've priced in things like when you replace the rooftop units that are aging and dying. Then you will need to replace them with uh newer units that have energy recovery and and better controls and all of that kind of stuff because it will be required by the state to do that. So once that goes, you need to do even more. Yes, those more efficient. The state grants are great things, but they do come with some Oh, yeah. We see that, other questions. All right, we we have some limited time on this. So, in fact, I meant to start by asking Brian to kind of keep track of the time and let me know if I need to speed up our process. All right, so the next section is demographics and regional research. This section was done by Ballard King and Darren Bar of Ballard King is joining us remotely and hopefully all the technology is going to work and Darren is going to start talking now. If you're talking Hey guys. Hey everyone. So, uh, Valerie King was going was involved with doing some demographic and regional research to assist in this process. Michael, if you can go to the next slide. One second. So, as part of this process, we went ahead and we looked at um, city of St. Paul boundaries. But then we also went ahead and realized, you know, if we're going to take a look at a facility of this size, we're going to need participants from outside of the city to go ahead and use the facility. So, we looked at a 10-minute drive time and identified that as a primary service area or the distance people may or may not drive on a weekly basis to go ahead and use a facility. The next slide goes ahead and begins to point out some specific demo. Well, actually it goes ahead and points to other providers, right? Um, you know, the red dot, the red push pin in the middle is the location of the facility, but then you have all these other providers that are around us. And this was really telling as we put this together. So, we have social services, we have other recreation departments, we have YMCA, we have boys and girls clubs. But you know as you go ahead and as you begin to talk about it um and the potential for this facility that becomes significant. It becomes significant in one of two ways. Number one people might be offering similar services. Number two people you're going to need to offer something unique that differentiates yourself between the other providers. The next slide goes ahead and identifies some of the key demographic indicators. Obviously, the population in North St. Paul, if you're talking about a 30,000 square foot building, um, and you're just trying to support that with 12,000 people, small, way too small of a population. However, when you start talking about the population and that drive time, even as you begin to go ahead and pair it back with some of the other providers, it becomes a more reasonable number. Um, significant number of children in both service areas, which is significant users of facilities. income level points to a need to be sensitive with price points. Um, housing, they're spending a little less than you see in the national number. Entertainment a little bit less than we see on a national level. So, all of that merely goes ahead and says that, you know, the future of this facility, whatever is in whatever is included in it, um, needs to be sensitive to who might use it and price points for various services and and rental opportunities. We then went ahead and continued on this process with the next slide and took a look at different components. Right? So we have an exhaustive list of components that say okay here's components that generate a lot of revenue, little revenue, low revenue. So the uh activities that are highlighted in green are those that could go ahead and could take place in the facility as it is might need minor renovation. As you go ahead and as you look at those gray fac gray colored amenities, they could also take place in the facility but would require a significant renovation in addition to what is already being planned. So, um the fact that you have access to some aerobic and dance studios and you could do gym or indoor track or you could do indoor turf, um you really do have the potential for some revenue generating components. The cautionary tale being that you also have a market that's going to be a little bit frugal when it comes to some of those components. So um but this was a good educating process and a good step to take as we were figuring out okay what is the next step for the community center. The next slide I believe we start talking about operation performance. So this is where we start talking about when we look at these various options, what's it going to cost to operate the facility and how we're going to go ahead and what kind of revenue can we generate that offsets the operational expenses. So the next slide gets into a little bit more detail. Michael, is this you talking or me talking? Sorry. Apparently, you're not hearing me. Are you hearing me, Darren? So, um I'm just going to go ahead and cover this slide and hopefully Darren will will understand what happens next. Um this this particular slide is showing, like I said, it's showing an option. It's showing us looking at it and going, "How can we maximize the return on your investment in this building?" It's treating it like a development project. It's saying, "We have this much space. We're going to break it up into these kinds of tenant arrangements. So, you'll see uh the green is tenant lease space A, right? That's the library we talked about earlier staying in their spot. Uh tenant lease space B really can't change because of of its the infrastructure around it. So, it it stayed like it was in the previous slides. Um we did take the uh what is the fireside room and and we said, "All right, we can maximize that and still not get in the way of exiting and all of that kind of stuff." So, we blew that up as big as we could see doing, right? And then we've got the uh multi-purpose space uh assigned as as more area, right? So, what we did is we looked at it like that and then we said, what does that mean to you as a city if for operationals? What how would this look as a proforma as a business proforma for the city and or tenants who are going to be asked to participate in this project with you. Right? So that's what's going to happen on the next slides is we're going to take this plan and we're going to break it up into potential uh revenue generating uh programs for the city or for the building. Right. Right. Darren, can you talk about the uh the required expenditures uh spreadsheet? So, I will go ahead and cover this. I'm uh if we have questions for Darren, we'll figure out how to ask him those questions later. Um, so what you're seeing in that spreadsheet on the right, we're not going to go through all those numbers, but Ballard King does this a lot and they do it all over the country and we asked them to take a look at this project and treat it like one of their other clients. How would how would this shape up? So they pulled these numbers from other places. They verified that they are they make sense within our region and they created this uh these three options that you're seeing across the top. So for instance, the personnel, we see a staffing cost. You're going to have to have some sort of a a janitorial or custodial person, right? So that number shows up. We have commodities to buy toilet paper and and things like that. We've got contractual things like util utilities and all of that covered in in this discussion. And then uh you'll see down there an improvement allocation that is planning for future costs to maintain your building. And then you'll see the deferred maintenance number of $3 million at 4.25% uh borrowing costs for a 20-year loan, right? And then those numbers fit into the the spreadsheet in different ways depending on how we look at it. The importance of this particular slide is the blue and gray that you see on the left. That is the annual city subsidy required. So then the first number that you see there, the 379,000 would be if the building is sitting there and only the library is a paying tenant. The second number you see there would be the library and some other nonrecreational uh tenant taking up part of the building and the remainder of it sitting there. That would cost the city 302,375 annually for that building to sit there in that condition. If you have a full facility lease where somebody took the recreational components, the library is paying um and I should say that the what we're assuming is an average lease rate for facilities of this sort in the cities. We verified what that number would look like. Um, but if you had say a charter school taking part of it and that that brought along some recreational component that took over the the gymnasium and then you had the library that you would still have an annual subsidy that you were paying of 55,325 to have this building in your portfolio. And um and a way to look at that is that's your investment to having the library and having these other activities in your community. Any questions about that? Mine is the deferred maintenance, the 3 million at four and a half% for 20 years. Is that that's the number we talked about earlier? I get that. But is that a loan for 20 years? Yes, that is the city bonding for 20 years on that that that's what I was trying to get to. It's a bonding which I don't that's something we have to discuss when it comes to how much we bond for roads and stuff. We don't have a lot to b not money to bond or a lot of stuff to be able to bond with. We are currently a little heavily debted by um our current bond for the uh road reconstruction projects that we do run. So it would be difficult. That's what I was getting. Just checking to make sure that I was looking at that number correctly. Okay. Thank you. Any questions about any of the operational numbers here that would cause us to need to connect back up with Darren. Good. Not that we don't want to talk to Darren but a hassle we don't need at the moment. All right. Perform two. This one assumes the city maintains control and operation of the building. We wanted this a lot of these things come from options that we talked about in meetings. They they are common sense questions that came up to us while we were working on this and this is one where the city treats this building like the recreational community recreational facility it was intended to be. So this would be you guys running a rec center. Um so it assumes the facility is operated by the city. It assumes the library is the only paying tenant in the building. And then again I increased the city costs for some of that interior renovation work that we left out in the early uh earlier ones because we assumed some tenant improvements were. So, uh, again, all the numbers, uh, in the spreadsheet follow along just like they did before, except that the staffing numbers get bigger because now you need a director of the facility and some part-time staff to run the facility. The revenue offsets then do get bigger because you can now charge you can you can charge for memberships, you can charge for program activities, you can do uh things like that. Even though it is a community center, you can still have membership fees. You can still have program fees. That's what Ballard King brought to the table was that's how this would be set up in other communities just like yours is that they would have those kinds of offsets to some of those revenues. Is it speaking to a specific program and a specific number of hours of basketball versus pickle ball versus right? We don't know that. It's kind of averaging it out and saying this is a picture that makes sense for a community your size and a facility this size. The end result being that the annual city subsidy to operate the facility like that would be 258,69 per year, but you would have far more control over what's going on with the facility. Now, couple more things before we go back and we can we can go back and talk about all these numbers in greater detail. Um, all right. I've got something in the way on my screen, but I can look over here. So, some other options. Like I said, these are options we talked about in our uh meetings, but we wanted So, we wanted to bring this information to you. Uh, some of it has more value than others. Demolish the building. If you wanted to just walk away from it, tear it down. It's about $250,000 onetime cost to knock it down. Pros, you can sell the property and maybe recoup all of that. Probably recoup all that. That property is probably worth something given the uh new development that's going on over there. Problem is you lose your library. Uh you would also lose by the way the grant funding goes away too but you're also not spending it to fix your building. So u replacement cost of the current facility. What would it cost to build something like that again? And the answer is 14 to$18 million. You would probably still qualify for the grant but you'd really have to get moving because the grant expires before you could probably get all of that happening. But if you had the grant dollars, then it's 9 million to 13 million. So you've got a $3 million investment to keep the facility functional versus uh 14 to 18 million to build a new one. Um it does not none of that however replacement cost does none of it changes the operational challenges that you'd still be facing. All right. demolish the gymnasium and keep the remaining 10,000 square feet with the library. The gymnasium is a very large piece of that building. The gymnasium brings with it the operational and the programming needs and and other things and it narrows it has a much narrower tenant base. So, you know, we we thought, hey, what would happen if you took that off? Um, it keeps the library, right? It keeps your library space. Um, and it reduces that building scale like I said, but you would lose the grants and then what that means is that the cost for that would end up being 8.1 million. So, there's not a lot of value in that option, but it was an option we explored uh as a it's a it's a common sense piece of thought looking at it. Could we just keep the library piece, get rid of the rest? No, not really. It's It's still $8.1 million to tear that gymnasium off, rebuild the parts that need rebuilt, reconnect the mechanical systems back up to the part you kept. Um there there's just a lot of effort that would be involved in doing that. Lease all of the building, but retain control of the walking track. The walking track is something that sits in the in the grant thing um as a piece of specific stuff. So if somebody wanted to lease that gymnasium space and use it for something other than wreck, then you would have to keep the walking track because you have to keep the recreational component to keep the grants. So it occurred to us as something. So we looked at it and it creates a $63,000 annual subsidy because that would be unleashed space. I forget what the number like 4,000 square feet of unleashed space that comes off of everything else. So, if you needed to go down that route, that's the number. Um, the last thing that we talked about internally was hiring leasing agents to deal with leasing the space. We have all these conversations about leasing the space and they all sound really good, but what ultimately you're doing is you're asking your city manager to act as a real estate agent and go find tenants for a space and negotiate leases with those folks. Um, that's not their job. It's not something that they're necessarily good at. Uh so we did talk to uh some leasing agents in town um just to find out what what what would their fees look like? What would that look like if you hired a leasing agent to go out and fill your space for you? They charge a dollar per square foot per year of term. Right? So, the easy way to look at that is if if they're leasing a thousand square feet of your space for five years, then you pay them $5,000 to fill that space for you. And then theoretically, you recoup it over the length of the lease by putting, you know, one or$2 dollars a square foot on top of the leasing costs of the building. But it takes that out from underneath you. It does create some larger numbers though. If they lease the entire facility, then that upfront cost gets large and you would have to pay that upfront cost. So 30,000 square feet on a 20-year lease if they were to find that is going to be a large number that then you pay upfront, but and then recoup it later. But from a city's perspective, that's kind of a challenging thing because it comes out of your current budgets or your or your borrowing money to do that. I don't know. I'm not a finance guy, but we wanted to put that out there for you as an option. All right, time to do another pause and give you guys a chance to ask questions about all those numbers and I can back up and go through any of it second time if you need me to. Well, I know the city option four when it came to 2012 when they closed it, they were the city was losing $350,000 and there was no money to put into the building for the whole time they had the community center open. So, that would be a really tough one. In the third option under other options, the 8.1 million, what does that cover? Can you So if you demolish the gymnasium y right you're taking off the whole front of the building. So we got to put up a new wall of some sort. The mechanical equipment is sitting at the far end. I could go back to one of the plans and yeah right here. Um the light blue that you see on the left of that screen that's the mechanical room where most of the mechanicals are sitting in that wedge-shaped piece to the left. So once we take the gymnasium off, we somehow have to make sure all that ties back around in some realistic way, right? You can't just whack it all off. Um, and then you still have some other you still have a lot of the a lot you still have about half the deferred maintenance issues, but you still have some rooftop units. You still have some roof that needs replaced. You still have some of the bad exterior finish that needs to be replaced. So those numbers don't go away just because you'll whack the gym off. So they cut in half, but they're still there. So we end up with quite a few costs. We were surprised, too, when we started looking at it and putting numbers on it and went, "Holy cow." And you lost your grant because you took them, Jimmy. Okay. Thank you. But we knew somebody would asked the question. So we brought the number. Just curiosity out of what it would be for a levy for where 73,000 is about what we are 1%. So it would be 41% levy for $3 million. Is that about my math correct on that if that's what we had to do? I mean 3 million to that. So that was I just kind of curious to see what the whole number would actually be for levies especially when we're our bonds are tight just to get an idea of what that percentage is. So that number would have come from your finance Yeah. director. Yeah. We know it's a 73,000 per. I was just curious because you know you borrow money then against uh um bonding against uh levying and things like that too to get an idea of what both of the numbers would be. Any other questions? Anybody? A quick question. The uh so the three options that you you put out there under the performer one um even best case scenario if it was $50ome,000 a year that it would be subsidized. Um, does that take in consideration putting money aside for the deferred maintenance of the building moving forward? Yes, that has that improvement allocation line in it of $25,000 a year being set aside to provide for future maintenance and upfits and changes to your program. Perfect. And that's if it's fully leased, everything is the world is perfect and everything falls into place type of thing. That's what option three recognizes. And what I will put something out that I'm going to cover again a little bit later as long as we're talking about that subject, which is that the libraryies lease is um is at least through, no, let me say this differently. in discussions with the library that the city has had. We were not part of that, but my understanding of the discussion is that the library doesn't have any funds for leasing this um at least until 2027. That's the soonest they could start budgeting to provide any lease for this. And in their world, they think that they have a lease through 2030 that has no payments attached to it. So there's some oddity in the libraries lease that could have you not able to recoup any funds from them for two to three four five years. So it's not like you can go from zero to fully leased in one year or at one shot because the library is behind everything. We'll talk about other things we can help you provide you with and it might be things like what's a stack construction started in '05 but they couldn't they had to redo and do the lease in 10. So yeah, we've been working on that trying to but that's the only one we could find. So that's what we we're going off of right now. Everybody's aware that it's probably some sort of staggered buildup to these numbers. It's not sure to suddenly Good point jump into these numbers. So, for clarity on that, um the 2027, um the city was wondering from them, um because they were interested in having more square footage where their current operations are just for the sake that they have like a reading room that they use kind of uh in the area that is not their building that they built on to that. Um, and they have a two-year budget set out now that goes to the 2027 that they have no funds set aside for that because the current arrangement is they don't it's like a dollar a year for their uh rent being that they built the building. So, it wouldn't even be until um an actual paying rent on what they have is if we went above and beyond uh the end of the decade. Um the possibility of adding something for the request of that extra square footage for that reading room area for the kids story time is what we were referring to for if they would do it pay any kind of money prior to the end of the decade. Yeah, that makes sense. Right. Without further questions, then we'll talk about next steps. So, we put together a schedule because there were a variety of different things going on here. So, we wanted to make sure that we weren't tripping over anything. Um what you're seeing in the top three lines out there, the council workshop, that big star, that's us meeting today. The next step would be for us to do some community engagement and see what the community thinks about the process, the project, the the potential costs to the community. We've allotted about a month to be able to do that. So then we would be back in August with a report of that information to add to this. What does the city think? Um what what does your constituents think about it? Um if the council were to take immediate action, right, that's what the next one. So the council uh the solid bar of that the council takes action in 2025, accepts the grant in 2025, right? And starts a deferred maintenance project. and we start that work to do the architectural engineering work at the beginning of 2026. All of that's kind of a reasonable picture that says that this process keeps chugging along, then all of that deferred maintenance would probably be done by about the beginning of 2027, right? You have not yet run into the end of the lease or I'm sorry, the end of the um grant funding or anything. you haven't bumped in anything that doesn't work and you've gotten it done in about as much time as it would probably take to lease the facility and do tenant improvements and that that process makes sense to do it that way. If you didn't do it that way, you don't run into any significant issues. That's what we were really really looking at is what happens if you don't act on it in 2026 at all and it sits there for another year. You keep paying what you're currently paying, which would appear to be in the neighborhood of $50,000 a year in operational costs on a building that's sitting there doing nothing. And the cost of all the deferred maintenance work we're talking about keeps going up, but there's still time to get it done. That's what we did this study to to show you is that we're not recommending that you put it off. We don't think that would be a good idea. Those leaks are active. It would appear. Um we we we have anecdotal evidence that the leaks are active, the roof is currently slowly failing. The chances of your HVAC units just stopping are all of those are reasonably things you could expect in the next year. So, um we just wanted to put this schedule in here so you could look at it. Uh again, the leasing piece down here, you see the red bars. It's it's again it's what would happen? How long would it take to lease it? Could the leasing happen and the and the project construction happen and everything line up? Yes, it all can. It all makes some sense. Okay. So, um the project plan, right? Uh the city has been in contact with some folks that appear to be interested in leasing the facility. They've gone about as far as they can go in those conversations without having some more information from the council about what the council's thinking they're going to do. No sense of getting everybody all excited and about leasing it if the council isn't interested in keeping the facility. So there have been some there has been some interest but it's not been taken very far in conversation. Um and we need to do our public awareness campaign. Um those two things are part of the plan and kind of need some council direction before either one of those things can move anywhere from where it currently is. and Ava is going to talk for a couple minutes about what that uh public awareness campaign might look like so that you folks be uh aware of it. Assuming that you give direction tonight for us to move forward with that, then this is what's going to happen. So, I'd be working with Jill from the public um uh engagement piece. Um so, basically, we're we've been keeping residents up to date. There is a current um email list of uh very interested residents that we are going to continue to use and um continue putting out information on. Um but essentially what the public awareness campaign would basically be gauging the level of community interest in investing in this community center. essentially how much is the community willing to go behind this idea and um that will ultimately hopefully inform your decision about what to do next. Um and so then once um we have that information we will share that with you and as well as the public and then we'll be using different communication tools um to do that. But before this gets triggered, um we need some more uh direction from you. Um because it doesn't make sense to go out to the public and ask, hey, how how um willing are you uh to take on this project without first having the council ask for this? So now we're back to question time for you folks. Although in this particular effort it's discussion time for you folks. We put a couple of questions together that we would like you to discuss and create direction for the rest of the process. So uh what is the council's vision of the project and its continued service to the community? We we kind of need that direction before we can do the community outreach. Is the council supportive of the potential costs that we've discussed in this uh and and more specifically at what level does the council think that those costs might be supported by the by the city and the council? Um, is our continued progress that we've outlined going to the community for this public awareness, is it appropriate at this point in time? And then finally, how can our team assist with decision- making and anything else you folks really want to talk about? This is your time to discuss it. We're here to answer questions. Thank you for the presentation. breaking some of this down has really been eye openening but also helpful as we see the main pieces of what that grant indicates. Um we'll put together a document for the city for all of our buildings and the uh community center as a whole. And my question is is with these numbers, how much of how much would it cost to be doing some of these over time, not all at once? because there are severity levels from one being okay it's going to need to be done to four it needs to be done now like the roof um did you take those numbers into consideration when putting this presentation together? Yes, we did. Okay. Um specifically the biggest issues are in the in the HVAC equipment. So, the exterior finish is is bad and it's causing issues. The window systems are actively leaking and have been poorly fixed and need replaced. The HVAC equipment is that's the rooftop units and and some of the internal working stuff uh within the building is still working. However, you start taking on risk. All of that equipment is at 20 years old and it's uh 25 years is generally speaking what we consider the lifespan of some of that equipment. If you don't do all of that work, then you could potentially save a couple million dollars, but you're taking on risk. then the sudden failure of some of that equipment will need to be replaced at the tunes of hundreds of thousands of dollars suddenly needing replaced that's not in a city budget someplace. That's the the the discussions we had with staff when we were coming up with these numbers and and we decided that this the city is not interested in having that kind of risk hanging over it with that kind of important equipment. Maybe we're wrong and we would accept but none of it seemed to be in a position. We had our engineers come and specifically look at it and ask them that question. Is any of this something that we could put off? And their answer was no. It's all of about the same age. There's no guessing which one of them would fail first. So if you don't replace them all, something's going to fail in the next five years and you're going to be suddenly fixing it. Thank you. Thanks. That's what we're kind of figuring out with the other buildings, just like council member Schwar said, is we have these 2004 city hall and we got the the public works where nothing's been done since they were open either. So, we're trying to get in get uh funding and being able to do that. So, when you add up what public works, city hall, and the community center is, it's quite a bit. I can't remember, like seven, no, I can't remember what I won't even guess, but there was quite a bit. So, I guess let's go down the list because we have to do our part up here to help you guys. So, what is the council's vision of the project and its continued service to our community? I'm going to push back on that a tiny bit. I mean, to me, this is what we're paying part of the study for, to see what's feasible and what isn't. It's not necessarily about our vision. It's about them presenting options that we can present to the public to see if they like, not just for um uh different people. Does that make a little sense? It does. And we actually struggled with that a little bit because you go back to the should haves should haves. The city has tried running the facility in the past and and part of our directive was can we lease this to other people and can we but the problem with that is there's a chicken and egg in there is finding people who will lease it if there's no commitment to doing the work. How hard do we work? we as a team, how hard does the city work to find tenants if the city's not going to spend the $3 million to fix it? That's where we kept running into a roadblock. Talked to a few people. We have some ideas of who to talk to and some thoughts out there, but again, part of it for us to a true community center didn't work. So, that's not what we were looking at. We haven't had one since for 13 years now. It's not like this closed last year, and we're trying to figure out open it. Most people that live here didn't know we had one. So that's where we're it. And I talked to the mayor of Maplewood. You know, they were leased theirs out to the YMCA because they needed a tenant on it, but they spent $2 million, you know, a million dollars two years ago and now a million dollars this year to replace the half of the roof and now the other half. So, you know, that seems to be quite a struggle with all the community centers of the of the other mayors I've been talking to with cities is what do you do? because cities don't do business very well. I mean, we're not, you know, owning and I talked to the Bellway Ballroom, you know, they have weddings there all weekends and everything else and they still subsidize the community center 400,000 a year. So, I mean, it's one of those things where, you know, if you have it, it's it it's it's going to be um money coming out of of the city budget somewhere to be able to do it. And Darren was still on here, he would tell you that that's the case across the country. That's how that works. So we're not Yeah. So we're seeing it the right way. Yeah. I mean, as as a city to be able to do that, we have great parks, you know, we have other things, too. It's when we do something like this is what don't we want? Do we not want streets? Do we not because a a price of this magnitude is going to cut something out. And what are we going to cut out? What are your recommendations for additional revenue streams? So, we had the one slide. Let's back up. So all of these are potentials. The challenge to all of these is finding that connection between you folks and the people looking. There is no magic ball that does that. That's why we started exploring that leasing agent. As architects, we can design and build buildings. Ballard King, they can work with any of these tenants to develop a a program um and revenue streams and what you know what what does their their operations look like, right? If he has a client in mind that he can work with and uh Jill Brown is on the team to help communicate that stuff to the community. What none of us are built to do is help tie you folks to those potential tenants. That's why we went and looked at the leasing agents and said, "If you're not doing it and it's not our expertise, then the next step would be to hire a leasing agent or at least talk to leasing agents about how they would go about finding those local people that are interested in tying this together. Uh, Ballard King does have connections with um uh YMCA and that that kind of stuff at the national level. Their recommendation though is that you start locally, talk to the local YMCA or the local boys and girls clubs and see if they have a need and then build that into a picture that they take to the national to get the funding and then you work together with them to create that funding thing, that funding stream. Sure. Program. They can help with that, but we have to have the facility. The city has the city as the owner of the facility has to start those conversations with those different groups and they have to have a facility to show everybody and say, "This is what we're going to do." You can't take a potential facility to people and say, "Will you lease this if we build it out?" They want to see something that's more solid than that. I also spoke to our EDA just because we have our meetings with that and right now commercial rent is horrendous, you know, and to me, you know, Jim, they're looking at taking malls and making wreck ball courts or pickle ball courts out of and all these different spaces because there's so much commercial space that's empty that's wide open that can be into different things. So, that's another issue that I see is trying to rent things just because as far as there's so much space out there right now that people are dying to get people in because it's there's a lot of vacancies when it comes to to that. So, that concerns me too because it's not, you know, residential. We're doing commercial. It's commercial but it's community center still commercial space. And looking at the uh I guess kind of back to some of the performers, the $15 per square foot that's I assume that's standard, you know. So I mean even if we're renting out the full full facility, we've got an annual cost to the city of $55,000 at that $15 per square foot. Um, and that's assuming that we're charging the library for renting out their space. Um, which we're not currently doing. Right. Right. So, um, so you take that $48,000 back into $55,000, we're looking at, you know, over $100,000 per year that we're having to just pay to have this facility available with a library. and it's fully, you know, used. Um, okay. I guess the next question after is the council support of a potential cost represented by the project? By my back of the napkin math, the um the the options presented to us today were anywhere from basically 1% levy to 7% levy. Um currently we pay a tiny bit more than a 1% levy as it sits empty. Um that that's the cost. Dan, is that correct? I thought it was 79,000 we paid last year on the community center. So for me, I would have no issue keeping that the same and and possibly small increase. But one of the things to think about um is if everyone were to break their lease, we're we're talking about 7% of our levy that either we have to take away from things or add. Um, so so some some resident engagement with them knowing the true cost of potentially what they want would be helpful. But with actual, like I say, we pay 79,000 a year that says empty. I would have no problem continuing that. That 7% is if it's completely full and everything's in order. No, no, that that's 1%. the the 79 grand. But but if if all of a sudden the city were on the hook for the four 437,000, that represents about a 7% levy that we would have to make up from our residents. That doesn't count the 3 million. It it does because the 3 million was rolled into a loan in that 400,000 and or 437,000 per year if we can get a loan. Okay. Right. There's a lot of questions on Yeah. Okay. Yes, you picked up on I was going to comment on the fact that that assumes that you paid the $3 million. Well, it's an $8 million project. Three million on your end to fix the building up to be uh what to stop leaking to be useful to you for the next right and that you continue to use it for that next 20 years and then change your minds 10 years down the road. And that's where it gets me nervous when it comes to like the fiber. Everybody I get emails after I'm done talking. They said, "Man, that fiber set you off, mayor." And it does because it's so many years ago and we put this money into it and we never used it and we're keep paying and paying on something we don't have. So that's concerning for me down the line is you know for the 20 years can we be you know committed to that as far as that being able to um stay true to the loan. So that was my obser and the way I was looking at it is best case scenario we're at a 1% levy worst case scenario we're at a a 7.2% levy if in the community engagements we had resounding support that they were that they'd be willing to split in the middle you know of a 3.6% levy you know I if the majority of our residents said yes I'd be in favor of a 3.6% 6% levy. That would make me look favorably upon looking at leasing agents. But but that would be information I'd need to see from the community engagement first. Sure. And that was the purpose of this and pushing the study and um hiring on you guys as architects is to follow through with this whole process. We should I see your point, mayor, in regards to the potential loss of something like the fiber we have. Um, but I also see it as all right, what are the opportunities there? We see that this building I really appreciate the way you laid this out. Your presentation's fantastic. Um, but let's hear from the community. Let's wrap this up. Hear from the community. That's my opinion. I'm not going I'm just speaking on my end. Um, I want to hear from the community. I want to wrap it up, come back with an idea of what this looks like in August, right? And whether it's a move forward or it's me. Can I ask one question on Dan? Can can we do Can we borrow three million? Can you do you want to come up if you don't mind? So I there's a lot of people that are online today after the announcement and what was going on. I'm just curious to see where we're at as far as the base, you know, is that something where, you know, we sit in budgets all of us for for months. So I just wanted to verify if you recall on our la last bonding um that just took place this spring u for the road reconstruction, our bond rating went up. Um, and part of it is that they did look at what our next bond issuances are going to be, which is part of the the capital improvement plan that had the next two would be 27 and 29. So, if you throw in another $3 million, I can't guarantee you that your bond rating would hold at the A+. It may drop back down to the double A, which then ends up costing the city more on the borrowing part to it. If you also recall as we went through that um and looking at those uh components, a lot of people have compared us um to like the city of Mountains View population's pretty close to the same size. We looked at how much debt we're carrying comparison to how much debt they're carrying. Okay. Um and that's why you've heard me say in a numerous occasions how proud I am of the city council because we've actually been starting to levy money for some of our infrastructural components. We do have a component that is four facilities, not enough to cover another $3 million. You're going to end up having to raise the levy even more. We have something going to parks. You're going to find out later that that's not going to be as much as what some of the park requisition or requests are coming up for this upcoming year in the capital improvement plan. And then we have the the roads. Uh so when you ask that overall question, anything's possible. That's all. At the end of the day, it's going to cost uh more than likely on we're going to have to increase the levy. Um and again, I think you're pretty much well in tune that about $71,000 increases the levy a percent usually on a medium value home kind of somewhere roughly about $18 on an annual basis. Perfect. Thank you. Appreciate it. All right, we will move on. Thank you. Is there is this can I can can I please do if you don't Oh yeah, of course. That's what I was going to ask. What what we're going to do then is we're going to develop that public awareness campaign and get some input public input process here. We're going to develop some questions. Um I would highly recommend and we're going to start with this anyway is to keep them broad and general in in nature. Not ask do you support 50% level levy at, you know, $36 on your average out that but to to ask them what kinds of ranges, right? Ask them what kind of programming what their thoughts are about uh continuing to use the building. Um I'm specifically curious about people's questions regarding the library or thoughts regarding the library. If the building goes away, the library goes away. What does what does that mean? And do what do they support in in to keep the library in the community? Um, so we're going to get those kinds of inputs for you folks. If we have questions about the way the questions are starting to shape up, then we'll bring them back to you before we put them out to the public. But if they seem like they're reasonable and the staff agrees that they're reasonable, then we will move forward with that and try to get back here in a month with some input. Great. Um one other thing is you know is it come when it comes to questionnaires and stuff are you going to have the finances for you know as far as along because the community center is not a silo so we have other things in the city as far as budgeting and things like that is I mean is how do we am I off track here but how do we you know we just can't look at the the one as far as how much we're going to spend because it's not just all on that. Is there anybody else have any ideas on how to word that or if not I'm sorry I'm trying to follow you. Um it's they're they're asking questions about you know the amount of money to spend for the for the community center everything else but we also have other considerations where we're going to have to spend money on our other buildings. How do we get that out to the public that this is not just the one thing we're going to be focused on? Sure. I I understand what you're saying. That's what I'm kind of asking. We just can't silo this because it's not all about the one building for us for budgeting. And I don't know how that would work or if that's something that I think I think that's something we have to as a city be proactive on. And I don't know if it's something that Ava can build on the website that says, you know, we we have a page that indicates community center um awareness or there's just a piece on it and these in a small budget of or something in lines of a synopsis of the building improvements, whatever that looks like. Brian, we'd have to have you and Dan decide andor the whole team decide what that looks like. But I don't I don't disagree. I mean, I think some the transparency piece should be there, too. Um, of what it's going to cost as a overall. We do have to focus in on these other buildings, too, and make sure that these guys are fixed. So, that's exactly what you know, I hear you, mayor. One thing, I hear you, mayor, and we're in the process, as you indicated and the team knows, we're in the process of having w finished the project of what this costs. We have now included it in our capital improvement plan. Um, but that does pass by people sometimes. So, if you have if we have something similar to that and I I call on Ava because I know that she deals with the website, but um if there's a little piece of I don't know, we'd have to figure it out. We'd have talk Monks Council do that. Yeah, correct. Thank you. Yes. Okay, that's all I want. I just want to make sure it's not a cycle if we can. It's all important stuff. Everything we have is is assets and we need to make sure we keep track of them and be able to do some of them. Thank you so much. You get a great uh demonstration presentation and uh thank you. And um we're running five minutes behind so I ask for adjournment. Um one last question just because I know there are a lot of residents. Um when you're done, are you guys maybe willing to step outside and take some questions from the residents that are here. I I know it's not in the public forum, but they might have some specific questions for you. A few minutes as we're heading out. Anyone ask questions? German. Council member Woods. Second. Council member McKenzie. All those in favor say I. I. I. Give us five minutes, please. Uh 6:40. Thank you.